The hottest profit per ton of steel breaks through

The profit per ton of steel breaks through thousands, and the black system welcomes the "beautiful era" again

recently, the long tornado swept the black series again, and not only the futures prices of rebar, hot coil, coke and other futures hit new highs. The supply side reform has weakened excess capacity, and the profitability of steel enterprises has remained high. At present, the profit per ton of steel is more than 1000 yuan

analysts said that the "off-season is not light" demand driven, the frequent occurrence of environmental protection and production restriction policies, and the marginal or relaxed policies have boosted black goods. It is expected that the production restriction policy will continue to be rolled out in the second half of the year, which is bound to restrain the steel supply. Therefore, we should further look at the high black system. In addition, in the context of a strong position and limited production in the upstream and downstream industrial chain, the future profits of steel mills will remain high

"recently, rebar, hot coil, coke and other black series have reached new highs at this stage. On the one hand, driven by the demand of 'not light off-season' this year, on the other hand, the market sentiment is frequently boosted by the environmental protection and production restriction policy." Shi Lei, head of the new era futures investment consulting department, told the China Securities Journal

Shi Lei further said that steel demand has rebounded significantly since March, rising steadily in the traditional peak season in the second quarter. Even after entering the month, it still shows a pattern of "not light in the off-season". It is also obvious from the continuous decline of social inventory and factory warehouse inventory data of rebar that the actual demand for steel is much better than expected. From the perspective of policy, the three-year action plan for winning the blue sky defense war issued by the state at the end of June is a long-term plan that covers a wider scope, a longer time span and affects more steel production capacity than the 2017 heating season production restriction policy, which means that environmental protection production restriction will tend to be normalized. After the National People's Congress in late July, the market generally believed that the policy margin might be relaxed and infrastructure investment was expected to improve

"at present, whether manufacturers or traders, steel inventories are low with the recovery of the global economy. Steel mills are willing to support prices, and it is difficult to reduce market prices." Meierya futures black industry analyst Yao Jin said

it is worth mentioning that when the futures prices of rebar, hot coil and coke once again approached the high in the second half of last year, iron ore was far from the high. After struggling to resist the rise of 3.36% on July 25, the 1809 contract, the main contract of iron ore futures, returned to weakness again, falling 2.56% to 475 yuan/ton yesterday, a 25% difference from the high of 633.5 yuan/ton in the second half of last year

Zhuhao, a black industry analyst at the Dongzheng futures Derivatives Research Institute, said that under the background of limited production of steel mills, the demand for iron ore is not optimistic, and the blast furnace operating rate and ore port dredging volume have declined significantly, confirming weak demand. On the other hand, the ore port inventory is still maintained at more than 150 million tons. Judging from the early trend of shipment volume and sea freight, the ore arrival volume in August will increase significantly. Supply is high and demand is difficult to stimulate. Therefore, it is reasonable for iron ore prices to be low

the "good times" of steel mills

"although 2018 is a year in which the effect of supply side reform is weakened, it is the first year in which environmental protection and production restriction play an effective role. At present, the profit per ton of steel of steel mills is more than 1000 yuan." Caiyuanqi and Xu Chao, ferrous metal researchers at Guoxin futures, said that the huge profits of steel mills have been from the second and third quarters of 2017 and have continued so far. It is expected that the overall profitability of steel mills will remain high this year

according to Yao Jin's calculation, at present, the profit of screw thread steel (blast furnace) production in Tangshan is still at the level of 1000 yuan/ton. Although the price of coke and other products has increased significantly recently, steel mills are in a strong position in the upstream and downstream industrial chain, and under the background of limited production, steel mill profits will remain high

the data released by China Iron and Steel Industry Association on July 25 shows that in the first half of the year, about 380 major iron and steel enterprises in China achieved sales revenue of 1.97 trillion yuan, an increase of 15.33% year-on-year; The profit was 139.273 billion yuan, a year-on-year increase of 151.15%

in terms of upstream raw iron ore, according to yesterday's futures closing price, the steel ore ratio has reached more than 8.7, a new high after last year's heating season. Zhu Hao said, "after the continuous rise in coke prices, the proportion of iron ore in steel costs has further decreased."

in fact, since the end of the winter production restriction policy at the end of the first quarter, the operating rate of iron and steel blast furnaces has gradually increased, and the national crude steel output has been rapidly expanded since March. According to the National Bureau of statistics, China's crude steel output in June 2018 was 80.2 million tons, an increase of 7.5% year-on-year, second only to the historical high of 81.13 million tons in May; The monthly crude steel output was 451.16 million tons, with a year-on-year increase of 6.0%, and the growth rate was 0.6 percentage points higher than that of the month

"in addition to policy factors, the high profit per ton of steel is also one of the main reasons for the higher than expected growth of crude steel output." Shi Lei said that from June to July, steel profits fluctuated in the range of yuan/ton. The attractive profit level keeps the enthusiasm of steel mills to start work, and the output is expected to remain at a high level of about 80million tons in July

Cai Yuanqi and Xu Chao further said that due to the mentality of buying up rather than buying down in the spot market, futures led to the rise of spot goods. The guiding price of Shagang was increased by 100 yuan in early August, with a cumulative increase of 200 yuan/ton. The steel mills and traders formed a profit community, and the overall inventory was running at a low level. It is expected that this round of rise will continue until traders start to build inventories with an export amount of US $25.574 million or steel mills no longer support prices

"Black Legend" market is expected. How long can black products be "red"

"the trend of black series in the second half of the year will generally depend on the relative strength between the macroeconomic downturn and environmental protection and production restriction." Zhu Hao believes that the recent easing policy and environmental pressure have caused the two forces to change, so the black system has increased, but the macro-economy is facing downward pressure, and external disturbance factors still exist. In terms of environmental protection and production restriction, many production enterprises gradually adapt to the pace of environmental protection and find out ways to increase production under production restriction. Moreover, production restriction in non heating season has been in full swing. It is expected that the reduction in marginal production will be relatively limited after entering the heating season in the second half of the year. On the whole, the high fluctuation pattern of steel prices will be maintained, but there will be obvious pressure to rush higher again, which will be the high point in August or the whole year

in Shi Lei's view, the production restriction policy will be rolled out irregularly in the second half of the year, which is bound to inhibit the supply of steel. Therefore, the price of black goods is on the high line

Yao Jin also believes that the black series as a whole will continue to rise in the second half of the year. At present, the overall plan of "blue sky defense war" has been announced, and all regions have also begun to launch supporting policies. In the second half of the year, the implementation of environmental protection will only be tighter and will not be relaxed. Therefore, the supply side contraction is the general trend. In addition, the implementation of the policy in the first two years focused on iron and steel. This year, coking may face greater rectification pressure. In terms of downstream demand, since the policy has proposed to expand domestic demand, terminal demand should be guaranteed

in terms of varieties, Cai Yuanqi and Xu Chao believe that in the medium term, the rising trend of black series is not over, especially coke. This year, the policy restrictions on coking enterprises are unprecedented, and only a few coking enterprises in Jiangsu Province have resumed normal production. Shanxi Province, the main producing area of coke, will also focus on the supervision and rectification of high pollution industries in August, and coking enterprises are resolute in supporting prices. In addition, iron ore and coking coal prices, which have lagged behind, are also expected to see a supplementary rise. However, investors still need to be alert to the impact of macro systemic risks in the second half of the year

Shi Lei also said that there are still three risk points to pay attention to: first, rising profits may keep the steel supply high. Although the operating rate is restricted, the steel plant can still increase its output by investing high-grade ore or increasing the proportion of scrap steel; Second, the real estate market policy variables are large; Third, the "off-season" situation may weaken the elasticity of demand in the second half of the year